-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, S+ZA01ynmUx6r3HUXDofmPdnEGzYcYBPE9gcUtjJyzh8LDBwCZNd+hvoUc+D9tL8 TTMnZWJuikexpkNa83XINA== 0001047469-98-034439.txt : 19980915 0001047469-98-034439.hdr.sgml : 19980915 ACCESSION NUMBER: 0001047469-98-034439 CONFORMED SUBMISSION TYPE: 8-K/A PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19980630 ITEM INFORMATION: FILED AS OF DATE: 19980914 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: ACCESS HEALTH INC CENTRAL INDEX KEY: 0000882304 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-MISC HEALTH & ALLIED SERVICES, NEC [8090] IRS NUMBER: 680163589 STATE OF INCORPORATION: DE FISCAL YEAR END: 0930 FILING VALUES: FORM TYPE: 8-K/A SEC ACT: SEC FILE NUMBER: 000-19758 FILM NUMBER: 98708594 BUSINESS ADDRESS: STREET 1: 335 INTERLOCKEN PARKWAY CITY: BROOMFIELD STATE: CO ZIP: 80021 BUSINESS PHONE: 3034669500 MAIL ADDRESS: STREET 1: 11020 WHITE ROCK RD CITY: RANCHO CORDOVA STATE: CA ZIP: 95670 FORMER COMPANY: FORMER CONFORMED NAME: ACCESS HEALTH MARKETING INC DATE OF NAME CHANGE: 19930328 8-K/A 1 FORM 8-K/A - ----------------------------------------------------------------------------- - ----------------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION WASHINGTON, DC 20549 FORM 8-K/A CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 JUNE 30, 1998 ---------------------------------------- Date of Report (Date of earliest event reported) ACCESS HEALTH, INC. - ----------------------------------------------------------------------------- (Exact name of Registrant as specified in its charter) ------------------------- ---------------------- ------------------- DELAWARE 0-19758 68-0163589 (State or other jurisdiction (Commission File Number) (I.R.S. Employer of incorporation) Identification No.) 335 INTERLOCKEN PARKWAY BROOMFIELD, CO 80021 ---------------------------------------- (Address of principal executive offices) (303) 466-9500 ---------------------------------------------------- (Registrant's telephone number, including area code) - ----------------------------------------------------------------------------- - ----------------------------------------------------------------------------- This amendment to the Current Report on Form 8-K filed by the Registrant with the Securities and Exchange Commission on July 10, 1998, is being filed to amend Item 7(b) thereto as set forth below. The undersigned Registrant hereby amends the following item of this Current Report on Form 8-K, originally filed with the Securities and Exchange Commission on July 10, 1998, as set forth on the page attached hereto. ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS. a. Financial Statements of Business Acquired. The financial statements of InterQual, Inc. required to be filed pursuant to Item 7(a) of Form 8-K are included as Exhibit 20.1 of this Current Report on Form 8-K. b. Pro Forma Financial Information. The pro forma financial information required to be filed pursuant to Item 7(b) of this Current Report on Form 8-K are included as Exhibit 20.2 of this Current Report on Form 8-K. c. Exhibits. The following exhibits are filed in accordance with Item 601 of Regulation S-K as part of this report: 2.1 Amended and Restated Agreement and Plan of Reorganization dated as of June 4, 1998, entered into by and among Access Health, Inc., a Delaware corporation, InterQual, Inc., a Delaware corporation, and Access Acquisition Corp. 98A, a Delaware corporation (incorporated by reference to Annex A to the Prospectus contained in the Company's Registration Statement on Form S-4 (File No. 333-56253)). 20.1 Financial Statements of InterQual, Inc., including balance sheets of InterQual, Inc. as of December 31, 1996 and 1997 and the statements of operations, changes in stockholders' equity (deficit), and cash flows for the years ended December 31, 1995, 1996 and 1997 (incorporated by reference to the Financial Statements of InterQual, Inc. included in the Prospectus contained in the Company's Registration Statement on Form S-4 (File No. 333-56253)). 20.2 Pro Forma Condensed Combined Financial Statements of Access Health, Inc. and InterQual, Inc., including unaudited condensed combined statements of operations for the years ended September 30, 1995, 1996 and 1997 and the six months ended March 31, 1997 and 1998 and unaudited condensed combined balance sheet as of March 31, 1998. 23.1 Consent of Alexander, Aronson, Finning & Co., P.C. * * Previously filed as Exhibit to the Registrant's Current Report on Form 8-K filed with the Securities and Exchange Commission on July 10, 1998. -2- SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this Report to be signed on its behalf by the undersigned hereunto duly authorized. ACCESS HEALTH, INC. Dated: September 14, 1998 By: /s/ JULIE A. BROOKS ----------------------------------- Name: Julie A. Brooks Title: Senior Vice President and General Counsel -3- EXHIBIT INDEX
Exhibit Description Page Number 2.1 Amended and Restated Agreement and Plan of Reorganization dated as of June 4, 1998, entered into by and among Access Health, Inc., a Delaware corporation, InterQual, Inc., a Delaware corporation, and Access Acquisition Corp. 98A, a Delaware corporation (incorporated by reference to Annex A to the Prospectus contained in Access Health's Registration Statement on Form S-4 (File No. 333-56253)). 20.1 Financial Statements of InterQual, Inc., including balance sheets of InterQual, Inc. as of December 31, 1996 and 1997 and the statements of operations, changes in stockholders' equity (deficit), and cash flows for the years ended December 31, 1995, 1996 and 1997 (incorporated by reference to the Financial Statements of InterQual, Inc. included in the Prospectus contained in the Company's Registration Statement on Form S-4(File No. 333-56253)). 20.2 Pro Forma Condensed Combined Financial Statements of Access Health, Inc. and InterQual, Inc., including unaudited condensed combined statements of operations for the years ended September 30, 1995, 1996 and 1997 and the six months ended March 31, 1997 and 1998 and unaudited condensed combined balance sheet as of March 31, 1998. 23.1 Consent of Alexander, Aronson, Finning & Co., P.C. *
* Previously filed as Exhibit to the Registrant's Current Report on Form 8-K filed with the Securities and Exchange Commission on July 10, 1998. -4- EX-20.2 2 EXH. 20.2 EXHIBIT 20.2 PRO FORMA CONDENSED COMBINED FINANCIAL STATEMENTS (UNAUDITED) The following unaudited pro forma condensed combined financial statements, including the notes thereto, are qualified in their entirety by reference to and should be read in conjunction with, the historical consolidated financial statements of Access Health and InterQual, including the notes thereto, incorporated by reference to the Company's Registration Statement on Form S-4 (File No. 333-56253). The unaudited pro forma condensed financial statements assume a business combination between Access Health and InterQual accounted for on a pooling-of-interests basis and are based on each company's respective historical consolidated financial statements and notes thereto, which are included or incorporated by reference herein. The unaudited pro forma condensed combined balance sheet combines Access Health's unaudited consolidated condensed balance sheet as of March 31, 1998 with InterQual's unaudited condensed balance sheet as of March 31, 1998, giving effect to the Merger as if it had occurred on March 31, 1998. The unaudited pro forma combined condensed statements of operations combine Access Health's historical results for the years ended September 30, 1995, 1996 and 1997 and the six months ended March 31, 1997 and 1998 with InterQual's historical results for the years ended December 31, 1995, 1996 and 1997 and the six months ended June 30, 1997 and March 31, 1998, respectively, giving effect to the Merger as if it had occurred at the beginning of the earliest period presented. The pro forma information is presented for illustrative purposes only and is not necessarily indicative of the operating results or financial position that would have occurred if the Merger had been consummated at the beginning of the earliest period presented, or at March 31, 1998, as appropriate, nor is it necessarily indicative of future operating results or financial position. 1 ACCESS HEALTH, INC. AND INTERQUAL, INC. UNAUDITED PRO FORMA CONDENSED COMBINED STATEMENTS OF OPERATIONS YEARS ENDED SEPTEMBER 30, 1995, 1996 AND 1997 (IN THOUSANDS, EXCEPT SHARE DATA)
ACCESS HEALTH, INC. INTERQUAL, INC. PRO FORMA COMBINED ---------------------------------- ------------------------- ---------------------------------- 1995 1996 1997 1995 1996 1997 1995 1996 1997 ---------- ---------- ---------- ------- ------- ------- ---------- ---------- ---------- Revenues: Care management services.. $ 26,484 $ 61,178 $ 93,729 $ -- $ -- $ -- $ 26,484 $ 61,178 $ 93,729 Licensing and support services................ 9,526 10,925 10,598 6,755 10,733 16,315 16,281 21,658 26,913 ---------- ---------- ---------- ------- ------- ------- ---------- ---------- ---------- Total revenues........ 36,010 72,103 104,327 6,755 10,733 16,315 42,765 82,836 120,642 ---------- ---------- ---------- ------- ------- ------- ---------- ---------- ---------- Costs and expenses: Cost of revenues: Care management services.............. 19,374 34,653 49,237 -- -- -- 19,374 34,653 49,237 Licensing and support services.............. 4,961 5,349 3,244 3,595 3,281 4,635 8,556 8,630 7,879 Product and other development........... 3,298 6,545 7,922 674 1,805 3,310 3,972 8,350 11,232 Sales and marketing..... 5,487 9,468 8,907 947 1,940 2,777 6,434 11,408 11,684 General and administrative........ 4,540 10,391 8,614 2,427 3,506 4,885 6,967 13,897 13,499 Transaction costs....... -- -- 6,345 -- -- -- -- -- 6,345 Integration and restructuring costs... -- -- 9,661 -- -- -- -- -- 9,661 ---------- ---------- ---------- ------- ------- ------- ---------- ---------- ---------- Total costs and expense............. 37,660 66,406 93,930 7,643 10,532 15,607 45,303 76,938 109,537 ---------- ---------- ---------- ------- ------- ------- ---------- ---------- ---------- Income (loss) from operations................ (1,650) 5,697 10,397 (888) 201 708 (2,538) 5,898 11,105 Non-operating income (expenses): Impairment loss on interest in AHN......... -- -- (10,000) -- -- -- -- -- (10,000) Interest and other income.................. 877 1,633 2,182 34 -- -- 911 1,633 2,182 Interest expense.......... (150) (186) (324) (38) (39) (33) (188) (225) (357) ---------- ---------- ---------- ------- ------- ------- ---------- ---------- ---------- Income (loss) before income taxes..................... (923) 7,144 2,255 (892) 162 675 (1,815) 7,306 2,930 Provision (credit) for income taxes.............. (242) 6,050 (2,363) (396) 60 313 (638) 6,110 (2,050) ---------- ---------- ---------- ------- -------- ------- ---------- ---------- ---------- Net income (loss)........... $ (681) $ 1,094 $ 4,618 $ (496) $ 102 $ 362 $ (1,177) $ 1,196 $ 4,980 ---------- ---------- ---------- ------- ------- ------- ---------- ---------- ---------- ---------- ---------- ---------- ------- ------- ------- ---------- ---------- ---------- Pro forma net income (loss) per share: Basic..................... $ (0.06) $ 0.08 $ 0.26 $(49.57) $ 10.17 $ 36.17 $ (0.08) $ 0.07 $ 0.23 ---------- ---------- ---------- ------- ------- ------- ---------- ---------- ---------- ---------- ---------- ---------- ------- ------- ------- ---------- ---------- ---------- Diluted................... $ (0.06) $ 0.06 $ 0.24 $(49.57) $ 9.31 $ 30.39 $ (0.08) $ 0.05 $ 0.21 ---------- ---------- ---------- ------- ------- ------- ---------- ---------- ---------- ---------- ---------- ---------- ------- ------- ------- ---------- ---------- ---------- Shares used in per share calculation: Basic..................... 11,000,000 12,884,000 17,854,000 10,000 10,000 10,000 14,814,000 16,698,000 21,668,000 Diluted................... 11,000,000 18,502,000 19,360,000 10,000 10,930 11,902 14,814,000 22,667,000 23,892,000
See accompanying notes to unaudited pro forma condensed combined financial statements. 2 ACCESS HEALTH, INC. AND INTERQUAL, INC. UNAUDITED PRO FORMA CONDENSED COMBINED STATEMENTS OF OPERATIONS SIX MONTHS ENDED MARCH 31, 1997 AND 1998 (IN THOUSANDS, EXCEPT SHARE DATA)
ACCESS HEALTH, INC. INTERQUAL, INC. PRO FORMA COMBINED -------------------------- -------------------- -------------------------- 1997 1998 1997 1998 1997 1998 ------------ ------------ --------- --------- ------------ ------------ Revenues: Care management services................... $ 44,417 $ 54,432 $ -- $ -- $ 44,417 $ 54,432 Licensing and support services............. 5,325 5,833 7,311 10,356 12,636 16,189 ------------ ------------ --------- --------- ------------ ------------ Total revenues......................... 49,742 60,265 7,311 10,356 57,053 70,621 Costs and expenses: Costs of revenues: Care management services................. 22,582 29,886 -- -- 22,582 29,886 Licensing and support services........... 2,029 1,359 2,074 2,667 4,103 4,026 Product and other development.............. 4,397 3,173 1,418 2,256 5,815 5,429 Sales and marketing........................ 4,246 4,659 1,312 1,758 5,558 6,417 General and administrative................. 4,558 4,823 2,114 3,205 6,672 8,028 Transaction costs.......................... 6,345 -- -- -- 6,345 -- Integration and restructuring costs........ 6,961 -- -- -- 6,961 -- ------------ ------------ --------- --------- ------------ ------------ Total costs and expenses............... 51,118 43,900 6,918 9,886 58,036 53,786 ------------ ------------ --------- --------- ------------ ------------ Income (loss) from operations................ (1,376) 16,365 393 470 (983) 16,835 Other income (expense)....................... 715 1,677 (15) (17) 700 1,660 ------------ ------------ --------- --------- ------------ ------------ Income (loss) before income taxes............ (661) 18,042 378 453 (283) 18,495 Provision (credit) for income taxes.......... (132) 6,856 176 208 44 7,064 ------------ ------------ --------- --------- ------------ ------------ Net income (loss)............................ $ (529) $ 11,186 $ 202 $ 245 $ (327) $ 11,431 ------------ ------------ --------- --------- ------------ ------------ ------------ ------------ --------- --------- ------------ ------------ Pro forma net income (loss) per share: Basic...................................... $ (0.03) $ 0.60 $ 20.20 $ 24.50 $ (0.02) $ 0.51 ------------ ------------ --------- --------- ------------ ------------ ------------ ------------ --------- --------- ------------ ------------ Diluted.................................... $ (0.03) $ 0.56 $ 17.03 $ 20.55 $ (0.02) $ 0.46 ------------ ------------ --------- --------- ------------ ------------ ------------ ------------ --------- --------- ------------ ------------ Shares used in per share calculation: Basic...................................... 17,719,000 18,556,000 10,000 10,000 21,533,000 22,370,000 Diluted.................................... 17,719,000 20,128,000 11,860 11,922 21,533,000 24,668,000
See accompanying notes to unaudited pro forma condensed combined financial statements. 3 ACCESS HEALTH, INC. AND INTERQUAL, INC. UNAUDITED PRO FORMA CONDENSED COMBINED BALANCE SHEET MARCH 31, 1998 (IN THOUSANDS)
ACCESS HEALTH, INTERQUAL, PRO FORMA PRO FORMA INC. INC ADJUSTMENT COMBINED ---------- ----------- ----------- ----------- ASSETS Current Assets: Cash equivalents.............................................. $ 43,820 $ 1,665 -- $ 45,485 Available-for-sale securities................................. 31,936 -- -- 31,936 Accounts and license fees receivable.......................... 14,289 5,314 -- 19,603 Deferred income taxes......................................... 5,012 4,544 -- 9,556 Prepaid expenses, income taxes receivable and other current assets...................................................... 8,668 1,124 -- 9,792 ---------- ----------- ----------- ----------- Total current assets...................................... 103,725 12,647 -- 116,372 Property and equipment, net..................................... 16,046 1,806 -- 17,852 Purchased intangibles........................................... 2,642 -- -- 2,642 Deferred income taxes........................................... 1,042 -- -- 1,042 Other assets.................................................... 427 204 -- 631 ---------- ----------- ----------- ----------- Total assets.............................................. $ 123,882 $ 14,657 -- $ 138,539 ---------- ----------- ----------- ----------- ---------- ----------- ----------- ----------- LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Accounts payable.............................................. 2,979 1,086 -- 4,065 Accrued payroll and related expenses.......................... 4,716 1,446 -- 6,162 Accrued integration and restructuring costs................... 1,912 -- -- 1,912 Taxes and other accrued expenses.............................. 9,877 11 -- 9,888 Accrued merger related expenses............................... -- -- 9,000 9,000 Other current liabilities..................................... 693 28 -- 721 Deferred revenue.............................................. 5,748 11,646 -- 17,394 ---------- ----------- ----------- ----------- Total current liabilities................................. 25,925 14,217 9,000 49,142 Capital lease obligations and other long-term debt.............. 312 68 -- 380 Stockholders' equity (deficit): Common stock.................................................. 86,947 133 -- 87,080 Retained earnings............................................. 10,698 239 (9,000) 1,937 ---------- ----------- ----------- ----------- Total stockholders' equity................................ 97,645 372 (9,000) 89,017 ---------- ----------- ----------- ----------- Total liabilities and stockholders' equity................ $ 123,882 $ 14,657 -- $ 138,539 ---------- ----------- ----------- ----------- ---------- ----------- ----------- -----------
See accompanying notes to unaudited pro forma condensed combined financial statements. 4 ACCESS HEALTH, INC. AND INTERQUAL, INC. NOTES TO UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL STATEMENTS NOTE 1. BASIS OF PRESENTATION The unaudited pro forma condensed combined statements of operations combine the historical statements of operations of Access Health for the years ended September 30, 1995, 1996 and 1997 and the six months ended March 31, 1997 and 1998, with the historical statements of operations of InterQual for the years ended December 31, 1995, 1996 and 1997, and the six months ended June 30, 1997 and March 31, 1998. No adjustments have been made in these pro forma financial statements to conform the accounting policies of the combining companies. The nature and extent of such adjustments, if any, are not expected to be significant. NOTE 2. PRO FORMA NET INCOME (LOSS) PER SHARE The number of shares of Access Health Common Stock issued in exchange for the outstanding shares of InterQual Capital Stock is based on the final exchange ratio. The final exchange ratio of 381.42 and 377.61 for the InterQual Class A Common Stock and for the InterQual Class B Common Stock respectively, was used in preparing the pro forma combined financial data. The following table provides the pro forma number of shares issued in connection with the Merger: InterQual Class A Common Stock outstanding as of March 31, 1998................. 10,000 Related exchange ratio...................................................... 381.42 ---------- Number of Access Health Common Stock exchanged for InterQual Class A Common Stock.......................................................................... 3,814,235 ---------- InterQual Class B Common Stock outstanding as of March 31, 1998 ................ 1,922 Related exchange ratio...................................................... 377.61 ---------- Number of Access Health Common Stock exchanged for InterQual Class B Common Stock.......................................................................... 725,765 ---------- Total Access Health Common Stock exchanged................................. 4,540,000 Total number of Access Health common shares outstanding as of March 31, 1998.... 18,815,879 ---------- Number of Access Health common shares outstanding after completion of the Merger......................................................................... 23,355,879 ---------- ----------
Access Health and InterQual each adopted Statement of Financial Accounting Standards No. 128 "Earnings per Share" ("SFAS 128"), which was required to be adopted on December 15, 1997. This statement establishes standards for computing and presenting basic and diluted earnings per share. Under this statement, basic earnings or loss per share is computed by dividing the net earnings or loss by the weighted average number of shares of common stock outstanding. Diluted earnings or loss per share is determined by dividing the net earnings or loss by the sum of (1) the weighted average number of common shares outstanding, (2) if not anti-dilutive, the number of shares of convertible preferred stock as if converted upon issuance, and (3) if not anti-dilutive, the effect of outstanding stock options determined utilizing the treasury stock method. 5 ACCESS HEALTH, INC. AND INTERQUAL, INC. NOTES TO UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL STATEMENTS (CONTINUED) NOTE 2. PRO FORMA NET INCOME (LOSS) PER SHARE (CONTINUED) A reconciliation of the numerators and the denominators of the basic and diluted per share computations for income for the years ended September 30, 1995, 1996 and 1997 and the six months ended March 31, 1997 and 1998 are as follows:
FOR THE YEAR ENDED SEPTEMBER 30, 1995 ------------------------------------- PER SHARE INCOME (LOSS) SHARES AMOUNT ------------- ---------- --------- Net income (loss).............................................. (1,177,000) Basic Earnings per Share Income available to common stockholders...................... (1,177,000) 14,814,000 $(0.08) --------- --------- Options issued to directors and employees.................... -- Convertible preferred stock.................................. -- ---------- Diluted Earnings per Share Income available to common stockholders...................... (1,177,000) 14,814,000 $(0.08) --------- ---------
Options to purchase approximately 1.9 million shares of Access Health's common stock, and convertible preferred stock that were convertible into approximately 3.7 million shares of Access Health's common stock were outstanding as of September 30, 1995 but were not included in the computation of diluted earnings per share because they were anti-dilutive.
FOR THE YEAR ENDED SEPTEMBER 30, 1996 ------------------------------------- PER SHARE INCOME SHARES AMOUNT ------------- ---------- --------- Net income..................................................... 1,196,000 Basic Earnings per Share Income available to common stockholders...................... 1,196,000 16,698,000 $ 0.07 --------- --------- Options issued to directors and employees.................... 2,276,000 Convertible preferred stock.................................. 3,693,000 ---------- Diluted Earnings per Share Income available to common stockholders...................... 1,196,000 22,667,000 $ 0.05 --------- ---------
FOR THE YEAR ENDED SEPTEMBER 30, 1997 ------------------------------------- PER SHARE INCOME SHARES AMOUNT ------------- ---------- --------- Net income..................................................... 4,980,000 Basic Earnings per Share Income available to common stockholders...................... 4,980,000 21,668,000 $ 0.23 --------- --------- Options issued to directors and employees.................... 2,224,000 ---------- Diluted Earnings per Share Income available to common stockholders...................... 4,980,000 23,892,000 $ 0.21 --------- ---------
6 ACCESS HEALTH, INC. AND INTERQUAL, INC. NOTES TO UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL STATEMENTS (CONTINUED) NOTE 2. PRO FORMA NET INCOME (LOSS) PER SHARE (CONTINUED)
FOR THE SIX MONTHS ENDED MARCH 31, 1997 ------------------------------------- PER SHARE INCOME (LOSS) SHARES AMOUNT ------------- ---------- --------- Net income (loss).............................................. (327,000) Basic Earnings per Share Income available to common stockholders...................... (327,000) 21,533,000 $(0.02) --------- --------- Options issued to directors and employees.................... -- ---------- Diluted Earnings per Share Income available to common stockholders...................... (327,000) 21,533,000 $(0.02) --------- ---------
Options to purchase approximately 3.9 million shares of Access Health's common stock were outstanding as of December 31, 1996 but were not included in the computation of diluted earnings per share because they were anti-dilutive.
FOR THE SIX MONTHS ENDED MARCH 31, 1998 ------------------------------------- PER SHARE INCOME SHARES AMOUNT ------------- ---------- --------- Net income..................................................... 11,431,000 Basic Earnings per Share Income available to common stockholders...................... 11,431,000 22,370,000 $ 0.51 --------- --------- Options issued to directors and employees.................... 2,298,000 ---------- Diluted Earnings per Share Income available to common stockholders...................... 11,431,000 24,668,000 $ 0.46 --------- ---------
The pro forma combined net income (loss) per share is based on the combined weighted average number of common (basic) and dilutive common equivalent shares (diluted) of Access Health and InterQual and the final common stock exchange ratio as of March 31, 1998 which results in the issuance of 4,540,000 shares of Access Health Common Stock for all of the outstanding shares of InterQual Capital Stock. The pro forma condensed combined statements of operations of Access Health for the fiscal years ended September 30, 1995, 1996 and 1997 include the operations of InterQual for the calendar years ended December 31, 1995, 1996 and 1997. The pro forma condensed combined statement of operations of Access Health for the six months ended March 31, 1997 and 1998 include the operations of InterQual for the six months ended June 30, 1997 and March 31, 1998, respectively. Accordingly, the Company's retained earnings have been adjusted for the effect of utilizing differing fiscal year ends for these periods. The revenues and net income of InterQual for the three months ended December 31, 1997 were $5,024,000 and $32,000, respectively. Share and per share information applicable to prior periods for Access Health and InterQual have been restated to reflect stock splits as discussed in each entity's respective financial statements and notes thereto. NOTE 3. PRO FORMA ADJUSTMENTS Access Health and InterQual have estimated that they will incur merger-related expenses of approximately $9 million, consisting primarily of transaction costs for financial advisory fees, attorneys, accountants and financial printing and other one-time charges related to the transaction. These nonrecurring expenses will be charged to operations as incurred. The pro forma condensed combined balance sheet gives effect to such expenses as if they had been incurred as of March 31, 1998; however, in accordance with Regulation S-X the pro forma condensed combined statements of operations do not give effect to such expenses. 7 -----END PRIVACY-ENHANCED MESSAGE-----